Welcome to Carbon Brief’s China Briefing.

Carbon Brief handpicks and explains the most important climate and energy stories from China over the past fortnight.Subscribe forfree here.

Snapshot

EV INVESTIGATION:China deemed the “formal” launch of the EU’s investigation into Chinese subsidies for electric vehicles as a “naked act of protectionism”, but refrained from making similarly strong public remarks during a visit from EU trade commissioner Valdis Dombrovskis.

DOUBLING NUCLEAR:The China Nuclear Energy Association said China can greenlight six to eight new nuclear power units a year, with the technology’s share of electricity doubling to 10% by 2035 and then 18% by 2060.

TREE RULES:China reformed communal forest tenure systems to encourage environmental protection and provide another revenue stream for low-income rural households. The rules could encourage the development of carbon sinks – or increase logging activity.

SPOTLIGHT:As China’s “belt and road initiative” celebrates its tenth anniversary, Carbon Brief asked four experts what it could mean for climate action in the decade ahead.

NEW SCIENCE:Studies found that citizens experience relatively limited levels of “energy justice” under China’s implementation of energy transition policies and, separately, that there were “substantial health co-benefits” from residential decarbonisation, particularly in northern China.

Key developments

EU split over Chinese EV probe

EV SPLIT:The European Commission has “formally launched” an anti-subsidies probe into electric vehicles manufactured in China, a process that should last one year, reportedBloomberg. The investigation was triggered by a request from France, according to the Hong-Kong based news outlet theSouth China Morning Post(SCMP). France has already changed “eligibility rules” to “make sure French state cash is not benefiting Chinese carmakers”, reportedReuters. But German chancellor Olaf Scholz has opposed the commission’s move on the grounds that “our economic model should not be based or rely on protectionism”, reported anotherReutersarticle. The bloc’s solar, wind and battery manufacturers have also sought support to compete against cheap Chinese competition, reportedSCMP. German-language business newspaperHandelsblattsaid the EU plans policies to make its wind industry more competitive with Chinese manufacturers.

CHINA’S REACTION:Beijing repeated its “strong dissatisfaction” with the investigation, calling it “a naked act of protectionism”, reported state news agencyXinhua. However,Bloombergnoted that China did not “publicly” share that criticism during commission executive vice-president Valdis Dombrovskis’ four-day trip to the country, shying away from confrontation amid “a broader push to stabilise geopolitical relationships [and] an economic slowdown at home”. AnotherBloombergarticle said that Tesla will be a significant focus of the EU investigation, having “enjoyed perks in China that other international companies struggled to obtain”. Elsewhere, Xie Zhenhua, China’s special envoy for climate change, “stressed the importance of opposing trade protectionism” at a summit in China, reportedCGTN, a state-affiliated Chinese media outlet. The Communist party-backedPeople’s Dailypublished a commentary under the “Zhongyin” byline – a nom de plume for top party leadership – saying the fact that “more than 60% of the world’s new energy vehicles are produced and sold in China” was an example of the country’s economic dynamism.

METALS SCRAP:Meanwhile, debate continues over China’s dominance of critical mineral supply chains, with theFinancial Timesreporting comments by US energy secretary Jennifer Granholm saying the situation could make the global energy transition “infinitely more complex”. China’s export of germanium, used for making solar panels and other technologies, fell to “zero” in August after the government imposed export controls, reportedTechSpot. At the same time, China has told local EV companies to procure chips and other components domestically to “set up a self-sufficient EV supply chain”, reportedDigiTimes Asia. However,Reutersreported that US firm AXT and a number of unnamed Chinese firms had received export licences in September for “gallium and germanium products” for certain customers.

Growing role for nuclear

10% BY 2035:Nuclear power’s share is expected to double to 10% of China’s electricity by 2035 and then grow to 18% by 2060, with installed capacity climbing from 57 gigawatts (GW) today to 400GW by 2060, according to the China Nuclear Energy Association (CNEA),Reutersreported. The outlet said China expected to approve “six to eight new nuclear power units” every year from now on. The state-run newspaperChina Dailyquoted Wang Binghua, the director of CNEA’s nuclear energy public communication committee, as telling thePaper: “In the context of achieving both the carbon goals and ensuring economic growth, nuclear energy has demonstrated its irreplaceable advantages.” According to the outlet, he said reaching the 10% projection would cut carbon dioxide (CO2) emissions by about 920m tonnes over this period. (For more background, see Carbon Brief’sQ&A: How China is using nuclear power to reduce its carbon emissions.)

SHIFTING VIEWS:Meanwhile,China Dailypublished comments made in a speech byInternational Atomic Energy Agency(IAEA) director general Rafael Grossi, who said that the public’s view towards nuclear energy has shifted. He stated that the “emergency” brought about by climate change was “undeniable” and that nuclear energy could play a “positive role” as part of the solution. “In the past few years, we have not been vocal enough about the benefits of nuclear power, but that page has been turned,” he added.

New forestry rules

CARBON SINKS:China released a plan to reform its communal forest tenure system in order to “enhance farmers’ incomes and promote green growth”, reported state news mediaCGTN. One aim of the plan is to “improve forest quality”, the outlet said, adding that “green industries, such as ecological tourism, maintaining healthy forests and environmental education” will be established. Business news outlet21st Century Dailynoted in an opinion column that the plan “encourages eligible places to carry out forestry carbon sink projects and establish a forestry carbon sink trading market”. TheLegal Dailyreported that the measures call for provinces to “strengthen the supply capacity of important primary forest products…and encourage provinces, cities and counties with forest resources to cultivate forestry ‘pillar industries’”. In an email to subscribers, consultancyTrivium China表示,改革可能导致更大的日志行为ivity.

CCER TRADING:Meanwhile, business news outletJiemianpublished comments by experts on the inclusion of forestry carbon sinks in China’s certified voluntary emission reductions scheme (CCERs). They explained some of the risks involved in the scheme, including guarding against oversupply, filling “legal gaps” in the policy framework and finalising mechanisms for distributing the proceeds of credit sales.

China’s ‘key role’ at COP28

CLIMATE DIPLOMACY:COP28 president-designate Sultan Ahmed Al Jaber wrote in an opinion article for state news agencyXinhuathatChina will play a “key role” in delivering on a COP28 agenda that “aims at fast-tracking an equitable and orderly energy transition, fixing climate finance, and focusing on people’s lives and livelihoods, while underpinning everything with full inclusivity”. He added that China is critical both for “driving clean energy adoption” in the global south and for supplying funding to support other developing nations’ energy transitions. Separately,China Newsquoted Zhang Jun, China’s permanent representative to the United Nations, as saying that China’s climate actions stand in sharp contrast to the “empty promises” of western nations. Elsewhere,Foreign Policysaid foreign minister Wang Yi is expected to travel to the US in October to manage their “increasingly frosty relations” and to “pave the way for a highly anticipated, but still unscheduled meeting between US president Joe Biden and Chinese president Xi Jinping”.

COAL CONTINUES:Meanwhile, speaking at a forum in Beijing, China’s climate envoy Xie Zhenhua said that the “complete phasing-out of fossil fuels is not realistic”, reportedReuters. This came as Hong Kong-basedSouth China Morning Postcovered a report from energy consultancy Rystad Energy finding that “China will increase its coal consumption until 2026 and will only record declines after 2027”.

Spotlight

How will China’s belt and road initiative impact climate action?

China will host the thirdBelt and Road Forum for International Cooperationthis month, as “2023 mark[s] the 10th anniversary of the belt and road initiative (BRI)”,Reutersreported. More than 110 countries are set toattend.

TheBRIis a global infrastructure project that aims to develop transcontinental trade routes between China and the rest of the world. With China having stated an intention to pivot the initiative towards low-carbon energy development, Carbon Brief asks leading experts what impact the BRI might have on climate action in the decade ahead. Their responses have been edited for clarity and length.

Prof Kevin P Gallagher, director of theBoston University Global Development Policy Center:

As the BRI moves into its second decade, China can solidify its pivot toward low-carbon development in the global south. According toour researchat the Boston University Global Development Policy Center, in the early stages of the BRI the majority of China’s overseas energy finance was…in fossil fuels in general and coal-fired power plants in particular. Emissions from the operating Chinese-financed power plants around the world now emit upwards of 245m tonnes of CO2 annually, roughly the energy-related CO2 emissions from the entire country of Spain or Thailand annually. In 2021, China announced it would not build new coal-fired power projects abroad and to step up support for low-carbon development. Moving forward, China could pledge to ramp up overseas financing for low carbon development and adopt a green project pipeline facility to ensure alignment with these directives.

Prof Lin Boqiang, dean of theChina Institute for Studies in Energy Policy, Xiamen University:

In some countries along the “belt and road”, despite the rapid growth of energy demand, the development of green energy is limited due to their relatively backward economic and technological level and the lack of advanced clean-energy technology and facilities. Through the construction of renewable energy projects, such as wind and solar power, China can provide technical, financial and experience support to host countries to promote the development and upgrading of their renewable energy industries. By providing more clean-energy supplies to these countries…China helps them reduce their dependence on traditional energy sources and promotes energy transformation and green development. At the same time, some countries along the belt and road have problems such as unstable energy supply, energy poverty and low energy efficiency…Cooperation to develop renewable energy projects…will help these countries improve their energy security and promote sustainable development along the belt and road.

Yasiru Ranaraja, founding director of theBelt and Road Initiative Sri Lanka(BRISL)

中国承诺将向low-ca砖rbon energy development has significant implications for climate action in the coming decade…China, through the BRI, has emerged as a crucial player in advocating a three-phase approach to low-carbon development: funding, construction and operation. Under the BRI umbrella, numerous infrastructure projects…are dedicated to green development…For example, in Sri Lanka, the Colombo International Container Terminal (CICT), which is an investment development project under BRI, has embraced green technology since its inception in 2014.

This terminal has witnessed a remarkable increase in cargo volumes over the years while prioritising environmental sustainability. The shift to electric cranes has resulted in a 45% reduction in CO2 emissions and a 95% decrease in diesel consumption…Additionally, more than 80% of the terminal’s electricity comes from solar technology. The terminal’s success story…exemplifies how commercial prosperity and environmental protection can coexist harmoniously.

Prof Christoph Nedopil Wang, director of theGriffith Asia Institute, Griffith University:

中国控制着全球几乎所有green-energ的部分y supply chain – from critical minerals for batteries to wafer production for solar, from manufacturing wind turbines to the necessary financing. Without China’s cooperation, a green-energy transition is hardly achievable – whether in the BRI or beyond…BRI countries, meanwhile, must improve their energy planning, energy policy and power markets to be able to attract sufficient Chinese investments in green energy. This should include a phase-down of fossil subsidies and better utilisation of blended finance to reduce financing cost for green energies, as well as longer-term green energy PPAs (power purchase agreements). A big question remains on the accelerated phase-down of Chinese sponsored coal-fired power plants and replacement with green energy. A recent study by the绿色金融&Development CenterandClimate Smart Venturesshows significant financial benefits for Chinese sponsors of plants in Vietnam and Pakistan when accelerating retirement and replacement.

看、读、听

PEAK OIL:TheFinancial Timesexplored the tension that exists between China’s role as the largest global consumer of oil and the minor role that oil plays in China’s energy mix, following comments by the chief executive of one of China’s largest oil companies that “perhaps this year China’s domestic oil demand will reach a peak”.

CRITICAL MINERALS:In the third part of a series on China and energy geopolitics, theOxford Institute for Energy Studiesdiscussed China’s importance for the critical minerals used in new energy supply chains and what its dominance could mean for the future.

METHANE RESEARCH:TheWoodrow Wilson Centerinterviewed Dr Hu Tao, founder of the Lakestone Institute for Sustainable Development, on his institute’s work on methane mitigation from food waste and manure in China, as well as on his views on how China’s voluntary carbon credit scheme (CCERs) could mitigate agricultural methane.

MARKET MECHANISMS:Caixin published part of the upcoming report on China’s “carbon neutral strategy and path selection”, written by theBoao Forum for Asia Academy. The report advocates improving market mechanisms to support a “just” energy transition, such as research investment, carbon markets, power grid pricing and funding non-renewable “clean” energy solutions.

New science

Costs and health benefits of the rural energy transition to carbon neutrality in China
Nature Communications

A study found that residential decarbonisation “would remarkably improve air quality in northern China, yielding substantial health co-benefits”. Decarbonising rural cooking and heating, the researchers added, “would triple contemporary energy consumption from 2014 to 2060”, which would considerably reduce energy poverty in China. The effects would be most strongly felt in Shandong, Heilongjiang, Shanxi and Hebei provinces.

Assessing energy justice in climate change policies: an empirical examination of China’s energy transition
Climate Policy

A new study explored “key aspects of energy transition policy implementation in China” through the lens of distributional, recognition and procedural justice. From a case study assessing China’s ‘coal-to-gas’ energy transition policy in rural regions, it found a “markedly low” level of procedural justice, linked to poor access to political participation and low transparency. It also found “insufficient acknowledgment of the needs of specific groups” during the energy transition. By contrast, the level of distributional justice, defined as equitable allocation of benefits, was “reasonably high”.

China Briefing is compiledbyAnika Pateland edited byWanyuan SongandSimon Evans. Please send tips and feedback to[email protected].